Banks around the world are in a critical moment.
On one level, the sector flourishes. In its 2024 banking report: “The past two years were the best for banking services since before the 2007-2009 global money, with health profitability, capital and liquidity.”
With more than a total profit of 1 trillion per year, banking services are the most profitable sector in the world. So, what should they worry?
In simple phrases, many of this last success is a factor in high interest rates. Prices decrease all over the world: the European Central Bank is close to the end of its rapid session of the rate, and the Bank of England has recently reduced rates to 4.25 %. As a result, banks in the next 12 months will need to address basic issues about who they are, who are, and the value they bring.
This identity crisis has been built for some time, as the digital revolution questioned the network of branches that support retail banking services for decades, and the erosion of confidence in institutions in society, including the established banks, and a new generation of Challenger banks.
Banks mainly need to find a way to reconcile the need for people from effective daily banking services with their need for more profound financial services that require confidence -dependent relationships. Heritage banks need to identify valuable assets that exceed their public budgets: authentic customer relationships. Through the studied brand strategy and experience design, they can appear as reliable partners for life instead of facilities.
Getting this right is not easy, but it can be done, and it represents a great opportunity. Banks can reformulate themselves – instead of financial products’ motives – to support life providers so that people can live as they want and aspire to. They can find ways to play a role in “new” parts of customer lives (not only spontaneously with money) and remain “related to relationships” with changing people’s priorities during their lives.
At the heart of this is to bypass the screen of what the banking services seem to be, to what the real possible value of life might be. The value of life for customers is also where the commercial value of banks-secondary needs under the surface of what people may initially deal with a traditional bank (or “heritage”.
In the world of dry and rational banking services, we found that an exciting inspiration can be created using unique Map. This helps in turning attention away from clear areas to participate in the bank’s private products and services, and towards the full life image of the customer. This is where ideas and innovation can be launched. We can find new possibilities to meet people as they are in their lives, and to build a dialogue about what they do and want to do, instead of “selling” the products that banks want.
Heritage banks can rebuild confidence by re -imagining their “branches”; As places people honestly want to spend time – not just spaces to complete transactions.
For example, B-Lorks, which is supported by the Yorkshire Bank (which is now renamed the Virgin brand) in Manchester, is exactly this. The concept of experience that we created is a flexible and attractive destination that does not resemble the bank. Instead, it is a place, throughout the day and the week, inspiring the activities program, motivating and involving the local population in the face of discussions on the aspirations of personal life. By mixing the joint areas of work, small business custody, private meeting rooms, and comfortable sitting similar to the cafe with events spaces for gatherings around yoga, music or hot financial topics for this matter for customers, it becomes more than one bank; It becomes part of the daily customer life. It is a living space, stimulant, that cannot be life first. This only happens to the superiority of the strategy subscription to the most comparable branches of commercial performance.
Likewise, ̇ş Mekan, by I -M, for the ̇ş bank in Türkiye, also re-avoids the Al-Madinah Grand Street branch to communicate with people in the areas of life that exceeds financial services. Depending on the bank’s strengths in retail, art, culture, sustainability, and education, space hosts societal events, provides joint work areas, café, and even a material offer for their market on the Internet. An integrated application allows visitors to display events, books work spaces, and buy tickets, while a coordinated activities program guarantees that the space remains vibrant and relevant.
Either way, the branch becomes a living extension, the brand breathes, rooted in the real people’s lives, building emotional ties and relationships, gaining confidence and generating business through inspiring and self -relevant experiences.
Life -led transformation of ancient models will make effort, investment and vision. After all, we are talking about bypassing the decades -created banking model. But it has the ability to be stronger than any promise that banks can make in a great advertisement.
You will stop this jump, which will stop losing customers against new players or players only, and the loss of sales inherent due to low -face -to -face communication opportunities, and the loss of business through an indifferent customer base in the brand that is not enthusiastic to manage their financial resources more active.
They need to find new ways to establish their true stories, and to involve customers with what they are doing already, and therefore to inspire and motivate their customers to talk to them and trust them in their life plans.
While recent years have brought record profits – which are largely nourished by high interest rates – this window closes. Banks must now face what comes after the boom. It seems to be a problem-but it is an opportunity to wear it as one, for the sake of imagination and enlightening and focusing on customers.
Beit champion, co -founder, I am a mother
“How can heritage banks remain relevant with low prices” was originally created by banker international, a brand owned by Globaldata.
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